‘Gender diverse teams have higher potential to be successful’

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Shirley Somuah

Shirley Somuah

Shirley Somuah is a private equity investor who is passionate about transformational impact. She is a Partner at CardinalStone Capital Advisers (CCA), focused on sourcing, analysing and executing deals across Ghana and Nigeria. She has over a decade of experience spanning management consulting and investing. Prior to CCA, Shirley was a Vice President, Principal Investments Team at CardinalStone Partners. She has worked as a management consultant with Oliver Wyman, serving clients in North America, the Middle East and Africa from the New York and Dubai offices. She holds a BSc in Management Science and Engineering from Stanford University and an MBA from The Wharton School of the University of Pennsylvania. She also chairs the board of the non-profit West Africa Vocational Education (WAVE). In this interview with IJEOMA THOMAS-ODIA, she talks about her career journey and why women should get involved in leadership and business.

Share with us your career journey
TODAY I work as a private equity investor but I’ve had a varied career, and believe that all my previous roles have played a part in preparing me for my current position, even where the connections were not obvious. Initially, I studied Management Science and Engineering and even before graduating from Stanford, I was sure that I wouldn’t practise as an engineer in the strictest sense of the word. Engineering was however a valuable foundation, because it gave me the analytical skills that I continue to use in my career as an investor. While I was at Stanford, I interned at technology companies, including Microsoft and PayPal, in product management. This gave me a sense of the breadth of career opportunities. I also completed internship in Investment Banking, which opened my eyes to the world of finance. I then started my career at Oliver Wyman as a management consultant. That was an excellent foundation for me; I enjoyed working with smart people, on a diverse set of problems. I was based primarily in Dubai, where I served clients across the Middle East and Africa, in sectors as varied as an automotive manufacturing master-plan to broadband strategy. Consulting gave me an invaluable problem-solving framework, but also left me wanting to see beyond our recommendations, and ultimately looking for a professional focus that would allow me to leverage my skills but have a longer term view of their impact. While at business school, I decided that my career focus would be investing in emerging markets, with a focus on Africa. Ultimately my choice of location was determined by philosophy. I wanted to find an investment firm with an entrepreneurial vision. I met my current partners when they came to speak at a business school conference, and felt then that I had found people with a shared vision. I joined the team to develop a Principal Investments business at CardinalStone Partners, and five years ago, we started the journey to building a private equity firm, which today is CardinalStone Capital Advisers.

You have over a decade experience that cuts across management consulting and investing. How has this helped you to evolve?
My passions have been constant throughout my career journey but I’ve learnt to change and discover the best vehicle for the work I want to do. I’m passionate about transformational impact at scale and investing in African markets is the perfect platform. Every step of my journey has led me towards that, although I didn’t always realise at the time. Studying engineering gave me analytical skills that I use today in analysis and decision making. Working in a management consulting firm gave me exposure to a breadth of industries, and most importantly a framework to understand growth drivers. That allows me to delve into industries and assess the businesses that operate within them.Working in Principal Investing prepared me for growth investing in our markets, where it is less about financial engineering but more about the ability to add operational value. It’s about understanding what it takes to grow a business successfully, and communicating that in the context of private equity.

Startups have their peculiar challenges, especially their ability to survive after a few years. Why are you interested in focusing on them?
Majority of our businesses are actually growth-stage, and not start-ups. It is true that the majority of businesses fail – The US-based Bureau of Labour Statistics reports that 65 per cent of businesses fail during the first 10 years of operation. In picking businesses to invest in, we first identify where the greatest opportunity is: where can we have an impact at scale and generate attractive returns for our stakeholders? Risk is a constant factor to consider when investing, so we’re diligent in conducting analysis to choose our partners, to increase the chances of being successful. We seek opportunities where the risk we take in making an investment is balanced by the impact we have, as well as the financial return. We are sector agnostic, and further mitigate risk by building a diverse portfolio.

Are you satisfied with the number of start-ups and SMEs owned by women in Nigeria today?
Sub-saharan Africa has the highest rates of female entrepreneurship in the world – 26 per cent of the female adult population is engaged in early-stage entrepreneurial activity in the region, according to the Global Entrepreneurship Monitor. The challenge is not with ownership but with access to funding, that’s an issue we see globally in private equity. In Europe, for example, just 1.1 per cent of the total capital invested in venture-backed startups is awarded to companies founded solely by women, according to data from UN Women. This issue has to be addressed because it makes good business sense to do so. We can’t exclude half of the entrepreneurial population. Data from the IFC’s landmark study on gender balance in Private Equity and Venture Capital shows that gender balanced investment teams achieve superior returns, and are also more likely to fund female entrepreneurs. We have the responsibility to increase funding for women entrepreneurs, so that women have access to funding to scale.

With your passion for transformational impact, how are you living your fulfilling dreams?
Transformational impact, for me, means playing a critical role in building African businesses of scale, that have a measurable impact on the economies where we operate and fulfil the aspirations of our key stakeholders. I am fulfilling my dreams by building a successful investment platform that lives beyond us, and in doing so, delivering attractive returns to investors who’ve entrusted us with their money. One of the most important aspects of this, for me, is building a team where each individual is pushed to reach their maximum potential.

With the private equity and venture capital scenes in Africa dominated by male players, how can more women rise up the ladder?
Globally, women are underrepresented in the investing space and Venture capital is male-dominated, 81 per cent of venture capitalists are men. The landscape in Africa is not much better, and occasionally worse in some subsectors. We shouldn’t just count how many women are in the space, we also have to consider how many women are in senior positions. There must be a robust pipeline of women who are aware of these opportunities. To change the landscape and balance representation, stakeholders who are already in the industry have to play their part. For example, Private Equity firms should create environments where women can remain and thrive. Women should be able to find sponsorship and mentorship, particularly in the junior stages, both men and women are responsible for that. As providers of capital, we also have a responsibility to assess the businesses in which we engage. How gender diverse is the leadership in a potential business for investment?; what are the internal policies and commitments to retaining and developing women in that business? It is everyone’s responsibility to support women as they rise through the ranks.

How do you get inspired and stay motivated?
I love the work that I do. I’m privileged to work with talented colleagues that I respect, and they’re my most immediate source of inspiration. We share the same values of making an impact on the African continent. For the entrepreneurs that we support, it’s also a privilege being able to sit beside them and discuss the ways to unlock business potential. We’re a part of unlocking their goals and visions for the business and I find joy in that. My interests outside of work help me to achieve a balance so that I stay motivated in the office. My two great passions are gardening and art. I have the privilege to chair the board of WAVE Academies – West Africa Vocational Education, which I’ve been involved in since its founding. WAVE is a social enterprise tackling youth unemployment in West Africa – one of the most defining challenges of our generation. We are bridging the education to employment gap with a focus on soft-skills training which equips young people with life skills that propel and serve them through various career stages. We have placed many people in hospitality in particular, and it’s a particular joy to see the progression of many of our trainees through various Lagos hospitality institutions.

What is your position on women in leadership?
There aren’t enough women in leadership, there should be more equal representation across all sectors. McKinsey’s analysis finds that companies in the top quartile for gender diversity in the executive teams are 25 per cent more likely to have above-average profitability than companies in the fourth quartile.

Gender diverse teams are more successful and we get to the point of diversity by being conscious of seeking and retaining women.

How best can more women embrace and get involved in leadership roles while living fulfilling lives in these changing times?
Each person’s concept of fulfilment is different. Women should have agency to determine what fulfilment means to them. That can mean reaching the pinnacle of their chosen career, being a homemaker, or anything else that they desire. Leaders have a responsibility to create environments that nurture women’s ideas of success. As a business, we have the responsibility to create an environment which enables all of our people to thrive, including women.

What’s your life mantra?
The call to action from Margaret Mead: ‘Never doubt that a small group of thoughtful, committed citizens can change the world; indeed it’s the only thing that ever has.’